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general_correspondence

DCAA role with Contracting officer

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We are the prime on a CPFF IDIQ, and we were awarded a task order 7 months ago but haven't been paid yet. Unfortunately I don't work in the Finance Dept and have much detail but DCAA has not even passed our invoices on to the KO for approval and payment. The details are unclear, the claim may be a rate issue, or cost accounting issue, minor or major, I don't have those details however we have been paying our subcontracts for 7 months.  Any suggestions on this log jam?  How do we get relief from paying our subcontractor or should we, can we?

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File a claim under the Disputes clause.

No, the Government's failure to pay you does not relieve you of your duty to pay your subcontractors.

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2 hours ago, general_correspondence said:

The details are unclear, the claim may be a rate issue, or cost accounting issue, minor or major, I don't have those details however we have been paying our subcontracts for 7 months. 

I get that you don't work in the Finance Department, but you have a phone, don't you? Most companies have a point of contact for DCAA-related issues. Sometimes they are called Government Accounting, or Compliance, or even Accounts Receivable. Find out who your company POC is and call that person. Ask what the hold up is. I bet you'll have a better idea of the go-forward strategy after you speak to somebody who has a clue about "those details" that have held up payment of your invoice for seven months.

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19 hours ago, general_correspondence said:

How do we get relief from paying our subcontractor or should we, can we?

@ji20874 is correct when he says the government's failure to pay you does not relieve you of your duty to pay your subcontractors, absent something in the subcontract that provides for this contingency. That's because you're talking about two different contracts. Practicality aside, the prime's cash flow issues are not the subcontractor's cash flow issues, absent something in the subcontract that ties the two together.

PepeTheFrog has been involved in some...disagreements...where one party tries to use this argument. "Well, my contract with this other frog hasn't paid me yet, so therefore I don't have to pay you under this separate contract." What? It's idiotic and would be ruinous of your reputation. Saying your pockets are empty is another matter; that's the practicality of it, not the contractual issue. 

If you want to know when you have to pay your subcontractor, you should take the creative step of reading the subcontract's payment terms.

If you want to know what's going on with your own employer's finance department, you should take the creative step of walking down the hall or sending an email. Be careful, they might not be as friendly as strangers on the Internet.

Now, there is a way that you could contractually relieve your company of its duty to pay a subcontractor because the government has not paid your company yet. There is a nasty little contract clause or term or whatever called "Pay When Paid." This is brutal for you subcontractors out there. The prime includes this "Pay When Paid" clause instead of a Net 30 or "Pay Within X Days," and by doing so, the subcontractor only gets paid if and when the prime gets paid. That is just brutal. Ouch.

 

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General, is FAR 52.232-25 Alt I in your contract?  Just to make sure of what we are talking about, are you talking about interim payments described in 52.216-7(a)? If there is something wrong with your invoices, DCAA should have returned them to you within 7 days after receipt.

This doesn't sound right, even for DCAA.  Have you read DFARS 242.803?  

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